View source for The firm network contract and other forms of business cooperation

The comparison between [[Network contract under Italian Law|firm network contracts]] and other forms of business cooperation is functional to: 

# identify possible sources useful in filling the many gaps in the legislation on firm networks;
# identify (and regulate) possible phenomena of transformation into firm network contracts of pre-existing different forms of cooperation between enterprises, also in order to make a functional distinction depending on whether the network contract serves to begin a collaboration between previously unrelated enterprises; to stabilize a pre-existing collaboration; to respond with aggregation to forms of crisis; to bring together business entities that are different from each other.

We consider the following institutions, all provided for Italian legislation.

=[[The consortium]]=
This is an associative scheme between entrepreneurs that is suitable for encompassing two distinct phenomena of reality, namely the anti-competitive consortium and the coordinating consortium. Again, fundamental is the distinction between a consortium carrying out purely internal activities and a consortium with external activities. 

While the substantive differences from the firm network contract are minimized, the two cases are not fully overlapping either. In particular, it is possible to identify a substantial identity of regime between the two legal figures in the case where the network members have a common patrimonial fund and a common office for the execution of the network project. In such a case, in fact, the network members assume the status of an organizational group, which is in turn a necessary condition for the group to be given legal subjectivity. 

In particular, the differences between the two institutions include the following profiles: 

'''Purpose of the contract''' 

The firm network contract is signed for the pursuit of a specific purpose: to individually and collectively increase its innovative capacity and competitiveness in the market, to be achieved through collaboration or information exchange activities. On the other hand, the consortium contract is signed for the purpose of regulating or carrying out certain stages of the respective enterprises. 

'''Joint organization'''

It is provided as an essential element only for the firm network contract. In the event that the definition of the common program of the network provides for the establishment of the common fund and a common body, it must be concluded that we are faced with an organized group and therefore characterized by the presence of legal subjectivity.

'''Profit-making purpose'''

While the consortium purpose is akin to the mutualistic purpose, the network contract can have, indifferently, a mutualistic or lucrative purpose depending on the activity carried out and indicated in the program (i.e., depending on whether the intent of the network enterprises is to share profits or to achieve a direct advantage in terms of lower costs or higher revenues). 

'''Provisions about formalities'''

Only the written form is needed for the consortium (and only for consortia with external activities a form suitable for registration in the Commercial Register).

=Industrial Districts (ID)=
A district is an agglomeration of enterprises, generally of small and medium size, located in a circumscribed and historically determined territorial area, specialized in one or more phases of a production process and integrated through a complex network of economic and social interrelations. 

Compared to districts, first formally recognized by Law No. 317 of 1991, business networks are distinguished in that they disregard two elements that are instead essential to the former, namely specialization and territory. 

The typical characteristics of so-called industrial districts, which only partially coincide with those proper to the network contract, can be summarized as follows:

*there is a need for high specialization in a specific manufacturing sector or industry (typically so-called made in Italy);
*there is typically a high presence of small and medium-sized enterprises;
*the district essentially operates by breaking down production processes into different stages of reduced optimal size. This means that each enterprise included in the district realizes a specific segment of the value chain;
*sub-supply contracts are typically concluded to regulate relations between enterprises in the district;
*common production and organizational know-how is developed.

For further details about industrial districts see "[https://cros-legacy.ec.europa.eu/system/files/the_definition_of_industrial_districts.pdf The definition of Industrial Districts]" written by S. Lombardi on Jun 15-16, 2016.

=[[The company group (under Italian law)|THE COMPANY GROUP]] =
It is governed by Articles 2497 et seq. of the Civil Code and differs from the network contract in that 

*coordination among group companies is vertical, pyramidal, hierarchical in nature: one or more companies, called "''holding'' companies," perform management and coordination activities pursuant to Article 2497''sexies'' of the Civil Code over the other companies. According to this rule, it is presumed that the enterprise that is required to prepare annual financial statements in a peculiar manner, or the enterprise that exercises control over the other enterprises, performs management and coordination activities over them, i.e., gives them directives to influence their activities.
*In the network contract, on the other hand, no enterprise assumes the role of main contractor, such that it can be defined as eminently "horizontal". At most, there could be a sort of leadership in the head of one or more network enterprises, varying in competence, that is, for reasons of greater specialization or experience.

=[[Joint ventures|JOINT VENTURES]]=
These are forms of temporary and occasional cooperation between enterprises put in place to jointly carry out a complex work or affair, particularly used in the area of large public and private contracts. A stable organization is not established, but rather a set of mandated relationships in which the various participants take on the guise of principals except for one: the so-called "leader," who is entitled to act ''vis-à-vis'' the principal in the name and on behalf of all concerned. 

The essential characteristics of joint ventures are as follows, indeed not to be considered extraneous to the network contract: 

*joint ventures are formed for the implementation of a single work of a complex business;
*the individual enterprises that are part of a joint venture also maintain their autonomy during the execution of the contract, not giving rise to any form of joint exercise of an economic activity.  

The distinction, more precisely, lies in the circumstance that the objective of a joint venture is a project, not an activity, such as that regulated with the network program, which is functional for the growth of the individual participating enterprise.

=[[The European Economic Interest Grouping (EEIG)]]=
The EEIG, introduced by Legislative Decree 240/1991, is a plurilateral associative contract with a common purpose, necessarily transnational and made up of subjects carrying out heterogeneous activities (not necessarily commercial entrepreneurs), the purpose of which is to facilitate cross-border cooperation by developing the economic activity of the members, leaving ample autonomy to the contracting parties in outlining its organization and discipline.

The essential distinction from business networks is easy to identify: 

*at least two members must have their central administration and/or must carry out their economic activity in states other than the European Union;
*while it has legal subjectivity, it lacks patrimonial autonomy, resulting in the unlimited liability of its members.

=Franchising (or affiliation contract)=
It is a contract between legally independent parties, by virtue of which one party (franchisor) grants the availability to the other party (franchisee), in exchange for remuneration, of a set of industrial or intellectual property rights. In this way the franchisee is included into a system consisting of a plurality of other franchisees distributed throughout the territory, in order to market certain goods or services. This is, indeed, quite different from the network contract: in the affiliation contract a plurality of services typical of other named contracts (license to use distinctive signs, administration, service contract, lease or commodity loan of movable or immovable property) converge, unitedly aimed at achieving full economic integration between franchisor and franchisees.

For further details about franchising see "[https://www.investopedia.com/terms/f/franchisee.asp#:~:text=Examples%20of%20well%2Dknown%20franchise,Block%20(NYSE%3A%20HRB). Franchisee: Definition, Examples, Benefits, and Responsibilities]".

For some examples see "[https://mktoolboxsuite.com/franchise-examples/ 10 Brilliant Franchise Examples to Learn From (in 2022)]".

=References=

*F. Cafaggi, ''Il contratto di rete nella prassi. Prime riflessioni'', in ''Contratti'', 2011, pp. 511 et seq.
* G. F. Campobasso, ''Diritto commerciale'', vol. I, ''Diritto dell’impresa'', UTET Giuridica, Milano, 2022, pp. 255-291.
*G. F. Campobasso, ''Diritto commerciale'', vol. II, ''Diritto delle società'', UTET Giuridica, Milano, 2022, pp. 640 et seq.
*G. F. Campobasso, ''Diritto commerciale'', vol. III, ''Contratti, titoli di credito, procedure concorsuali'', UTET Giuridica, Milano, 2022, pp. 33 et seq.
*P. Corrias, ''Cooperazione tra imprese appaltatrici e responsabilità verso terzi'', in ''Responsabilità civile e previdenza'', 2016, pp. 736 et seq.
*A. Gentili, ''Una prospettiva analitica su reti di imprese e contratti di rete'', in ''Obbligazioni e contratti'', 2010, pp. 87 et seq.
*M. Libertini, ''Contratto di rete e concorrenza'', in ''Giustizia civile rivista trimestrale'', 2014.
* G. Meruzzi, ''Notazioni in tema di soggettività giuridica della rete'', in ''Il contratto di rete. Dalla teoria giuridica alla realtà operativa'', edited by G. Meruzzi, 11 aprile 2012, pp. 15 et seq.
*E. Mugnai, ''“Contratti di rete” e attività di direzione e coordinamento'', in ''Rivista di diritto societario'', 2015, pp. 823 et seq.
*P. Saccomanno, ''Il contratto di rete: profili di un’indagine aperta'', in ''Contratto e impresa'', 2017, pp. 673 et seq.
*P. Zanelli, ''Reti di impresa: dall’economia al diritto, dall’istituzione al contratto'', in ''Contratto e impresa'', 2010, pp. 951 et seq.

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